Cuts to annual cost-of-living adjustments in military retired pay are gone. Now comes the next fight.
Veterans groups that fought the retirement inflation changes took only a brief celebratory rest before gearing up the week of Feb. 17 for another round of personnel program cuts and legislative headaches. They anticipate that debate would start Feb. 24, as the Pentagon begins to release details of its fiscal 2015 budget proposal.
Advocates don’t expect to see massive changes to retirement pay proposed again this year. But they worry that other personnel programs will be targeted: basic pay, housing allowances, commissary benefits, Tricare fees.
All of those changes, they argue, could undermine recruiting and morale if done piecemeal. Instead, advocates want benefits and pay changes off the table until spring 2015, when the Military Compensation and Retirement Modernization Commission releases its comprehensive recommendations on ways to improve the system.
They doubt that will happen.
“You’d think that Congress and military would let the commission do the work they were chartered to do before they made any changes,” said Michael Hayden, director of government relations for the Military Officers Association of America. “But we’re afraid they aren’t going to wait.”
The move to cap annual retiree COLAs, expected to save $6 billion over 10 years, infuriated veterans’ groups that called it a violation of promises made to troops.
After weeks of lobbying, Congress repealed the cut for all current retirees and service members who enlisted before Jan. 1.
Pentagon officials have called personnel changes an “emotional” subject for troops and lobbyists but also one that must be addressed.
“We cannot afford to sustain the rate of growth in military compensation that we’ve experienced over the last decade,” Acting Deputy Defense Secretary Christine Fox told senators in January. “Our men and women recognize that if they are well-paid but the department does not have money to maintain their equipment ... then we have not done them a service.”
In recent years, defense officials have pushed unsuccessfully for increases in some retiree Tricare fees and active-duty basic pay raises that are lower than inflation. This year, they’ve already hinted at possible future cuts to the commissary budget and family programs.
“Right now, no one thinks the Pentagon is on [troops’ and veterans’] side when it comes to pay and benefits,” said Joe Davis of the Veterans of Foreign Wars. “We understand where they’re coming from, but they have to remember: no people, no military.”
But if budget planners wait for the compensation commission’s report to begin tackling pay and benefits changes, officials likely would not see any savings until the fiscal 2017 budget cycle.
Todd Harrison, senior fellow at the Center for Strategic and Budgetary Assessments, said a comprehensive approach to changes in compensation would be best, offering both cuts and new incentives to calm fears of breaking faith with the force.
“You don’t want to go at it piecemeal,” he said. “But DoD probably has to put something in its budget proposal to make the numbers work.”
Regardless of what’s in the fiscal 2015 defense request, it’s unclear whether lawmakers will accept deep cuts in personnel programs.
Larry Korb, senior fellow at the Center for American Progress and a former Pentagon personnel chief under President Reagan, called the latest retirement fight “a resounding defeat” that he believes will make most lawmakers reluctant to embrace similar proposals anytime soon.
Korb said that’s disappointing because he believes some reform is needed. “If they had kept [the COLA caps], there may have been a bipartisan path to look at all of the military entitlements,” he said. “Now, [lawmakers] will expect fights to any proposed changes.”